KfW lends USD 100m to Eskom to aid renewables integration

South African utility Eskom Holdings SOC Ltd on Friday signed a USD-100-million (EUR 86m) loan facility with German development bank KfW to support renewable energy integration.

The financing will aid Eskom in making further investments in the transmission network in the Northern Cape to help the renewable energy independent power producer (IPP) projects under the recently-signed power purchase agreements (PPAs) join the grid, the company said.

The loan will also allow the utility to continue projects to improve network reliability and load-growth in certain areas in the Eastern Cape.

"The facility demonstrates the improved market sentiment and confidence in the ability of the Eskom’s leadership to direct the company on the correct path to recovery and sustainability," said Eskom’s chief executive Phakamani Hadebe.

The loan will contribute to Eskom's ZAR-72-billion (USD 5.2bn/EUR 4.5bn) funding requirement for the 2018/19 financial year, according to the announcement.

KfW provided a ZAR-3.9-billion loan to Eskom in March 2015 to support renewables integration and overall grid improvements.

(USD 1 = EUR 0.862)

(ZAR 10 = USD 0.721/EUR 0.622)

Choose your newsletter by Renewables Now. Join for free!